Good morning! Welcome to The Morning Shift, your roundup of the auto news you crave, all in one place every weekday morning. Here are the important stories you need to know.
1st Gear: Truckin’ 2.0: Electric Boogaloo
Tesla made big waves with investors (except not really) by announcing eventual plans to get into electric big-rig trucking. We thought that was a pretty swell idea, and evidently so does Mercedes-Benz, as they plan to start selling one within five years. Via Bloomberg:
The 26-metric-ton Mercedes-Benz Urban eTruck will have a range of about 200 kilometers (120 miles) per battery charge, parent company Daimler AG said Wednesday in a statement. The model, targeted for inner-city tasks such as supermarket deliveries, could go on sale by “the start of the next decade,” it said.
Truckmakers are starting to develop electric models to meet tighter emissions rules for city centers, though options are limited due to a lack of batteries with the durability to propel fully loaded vehicles for long periods of constant use. Industry tests include the 6-ton Canter e-Cell from Daimler’s Fuso brand and a model from Volkswagen AG’s Scania division that’s powered by overhead electric cables. MAN SE, another VW unit, plans to show a battery-powered truck concept in September, while U.S. startup Nikola Motor Co. is scheduled to unveil a prototype in December.
“Until now, no one’s been making money from electric vehicles,” Wolfgang Bernhard, head of the Daimler Trucks division, said at the model’s presentation at company headquarters in Stuttgart, Germany. “But those who are too late with new technology lose market share, and that’s why these models are coming out now.”
Freight trucks seem like a great way to deploy more electric and autonomous driving technologies.
2nd Gear: Grand Jury Looks Into Fiat Chrysler’s Sales Problem
As our David Tracy explained today, Fiat Chrysler’s excuse for the possibly fraudulent new car sales over-reporting was basically “Our method sucked, so we fixed it. It still sucks, but there’s nothing we can do about it.” But the automaker is being probed by the Justice Department and the SEC, so that excuse may not fly.
Now Automotive News reports a federal grand jury has already begun probing the case to determine whether to bring charges against the automaker:
Some of Fiat Chrysler’s U.S. dealers have begun receiving subpoenas to provide documents and or testimony to a federal grand jury in Detroit as part of a probe into the company’s sales reporting practices, Automotive News has learned.
It is unclear how many of FCA’s approximately 2,650 U.S. dealerships have received subpoenas. Federal grand jury proceedings are secret under U.S. law.
A dealer source, speaking on condition of anonymity, confirmed that subpoenas had been issued seeking dealer-level sales data and other information.
It’s gonna be interesting to see where this one goes.
3rd Gear: But Jeep Sales Are Robust As Hell!
Well, even if Fiat Chrysler doesn’t know its ass from its elbow in terms of reporting sales, the automaker is confident enough about strong Jeep sales to revise 2016 profit targets upward. Via Bloomberg:
Fiat Chrysler Automobiles raised its 2016 profit forecast after earnings in the second quarter rose 16 percent on robust demand for Jeep SUVs.
Adjusted earnings before interest and taxes rose to 1.63 billion euros ($1.79 billion) from 1.4 billion euros a year ago, the Italian-American carmaker said in a statement on Wednesday. That compares with the 1.61 billion-euro average of 10 analyst estimates compiled by Bloomberg.
Will Americans ever run out of SUVs to buy? Not likely.
4th Gear: People Love Technology
J.D. Power just released its latest study that measures “the appeal of owning and driving new vehicles.” At the top of that brand list was Porsche, which makes sense because if I owned a brand new Porsche I’d probably find it pretty goddamn appealing too.
But the study also stressed the importance of semi-autonomous and new safety technology for car buyers. Via The Detroit News:
The study found that vehicles with driver-assist technology features like blind-spot monitoring or low-speed collision avoidance have better overall ratings than vehicles without them.
“Technology-enabled safety features help drivers feel more comfortable and confident while driving their vehicles,” Renee Stephens, vice president of U.S. automotive quality at J.D. Power, said in a statement. “These features are also ‘gateway technologies’ to autonomous driving capabilities, so the continued level of consumer interest in them will be a critical metric to watch as the industry evolves toward including more automation in new vehicles.”
J.D. Power based its rankings on responses from more than 84,000 people who bought and leased 2016 vehicles and who were surveyed after 90 days of ownership. The vehicles were registered between February and May.
5th Gear: No Love For The Elantra
To cap off something we covered in yesterday’s Morning Shift, Hyundai’s current lack of an extensive SUV lineup is hurting the automaker badly in the U.S. And the Elantra’s repositioning to be slightly more premium, right as Americans started abandoning sedans and small cars for crossovers, has been part of the problem. Via Reuters:
From being Hyundai’s top U.S. seller last year, Elantra sales skidded 25 percent in first-half 2016, trailing a 7 percent drop in its market segment, according to data from the company and Autodata Corp. On Tuesday, Hyundai said net profit fell for the 10th straight quarter, warning the U.S. market is about to get tougher still.
“I have built my sales and my reputation at Hyundai as being the value brand,” said Scott Fink, chief executive of Hyundai of New Port Richey, Florida, the biggest U.S. Hyundai dealership. “I understand the company’s desire to move upstream...but now you’re in the same ocean with Toyota and Honda, and Toyota and Honda most specifically in the U.S. have a much longer and better reputation than Hyundai, and we’re not there yet.”
Fink, a member of Hyundai’s U.S. dealer council, said the firm “moved too quickly” in attempting to raise prices for its cars. “U.S. dealers are disappointed by the sales performance of the 2017 Elantra,” he said, referring to the latest model in a phone interview with Reuters.
Reverse: Au Revoir, Deux Chevaux